The fact that massive punitive legal damages have been imposed by courts to large corporations such as Mobil Exxon, Union Carbide, and Pacific Gas and Electric brings notice upon organizations which their very survival may well be related upon how their employees deal with earth science related issues



In an effort to emphasize the much importance of the earth sciences to modern corporate organizations, a study of the massive 1989 oil spill incident in Prince William Sound and how it affected Mobil Exxon would be of much use. The environmental damage was incredibly much, and initial public outrage against the corporation was at very high levels, however Exxon managed to weather the storm and kept on continuing its operations, mainly because of the efforts of its own earth sciences people.

The problems all started on March 24, 1989 at 4 minutes past midnight, when the enormous oil super tanker Exxon Valdez struck a reef hidden under the pristine surface of Alaska's amazing Prince William Sound and started spilling massive amounts of crude oil into the sea. In the Alaskan darkness that spring night an environmental nightmare started that changed not only Prince William Sound itself, but the entire world, especially the business world.

In the first weeks right after the disaster, according to the advice of their own earth sciences people, who understood all too well how much environmental damage might ensue, Mobil Exxon volunteered to spend whateverall the money was needed on cleanup efforts and assessments of environmental damages after the accident and before the settlement. Over 2 billion dollars was quickly spent by Mobil Exxon on these efforts, and the company's PR people spared no opportunity to publicize the money being spent, and to repeatedly stress that it was voluntary, so the public would be aware of that fact and appreciate that Mobil Exxon was meeting its responsibilities to the public for the damage done to the environment.

Despite these efforts, nothing could stop the flood of lawsuits which resulted from the spill. After anightmare 30 months of devastating bad publicity for Mobil Exxon, and extremely serious financial losses, a legal settlement agreement was finally reached on October 8, 1991 between the plaintiffs?the State of Alaska and the US government?and Mobil Exxonattorneys on both criminal charges and civil damage claims stemming from the incident.

In settlement of civil charges, Mobil Exxonagreed to pay the State of Alaska and the US government over 900K Million USD over a 10 year period. This money would be used for environmental and wildlife restoration and would be administered by six government trustees; three of them federal appointees, and the other three state appointees.

In settlement of criminal charges, it was agreed that Mobil Exxon would pay two-hundred and fifty million dollars. Two restitution funds of fifty million dollars each were found, one under state control and one under federal authority. Although there was much opposition from many Alaskans, one-hundred and 25 million dollars of the balance was forgiven due to Mobil Exxon's cooperation during the cleanup, and because of the upgraded and highly-publicized safety procedures Mobil Exxon earth sciences department had designed to prevent a reoccurring similar event. The remaining 50 million dollars was divided between the Victims of Crime Act account and the North American Wetlands Conservation Fund.

But another huge setback was in store for Exxon. On September 16, 1994, an angry jury in a U.S Federal courtroom returned a stunning 5 billion dollar punitive damages verdict against the corporation. Mobil Exxon attorneys have fought this judgment in appeal after lengthy appeal over the last 7 years, and on November 7, 2001 won a major victory when United States Court of Appeals justices threw out the 1994 punitive damages verdict.

But Mobil Exxon has suffered mightily since the Exxon Valdez went aground in Prince William Sound that fateful night in 1989, and it is not an exaggeration to say that the very existence of the corporation has been at stake. Any business, no matter how large or small, is at the mercy of public approval, for it needs public approval to sell its product. And in Mobil Exxon's case, public approval has been very much dependent upon what the corporation's earth sciences people have been able to say and do to convince the public that the environmental damage to the Alaskan coastline is nowhere near as bad as other earth scientists have claimed.

In the twelve years since the oil spill, Mobil Exxon has relied heavily upon their own earth sciences department's employees, and hired outside earth sciences consultants in order to defend themselves against charges which they are liable for billions of dollars in environmental damage to the ecosystem of Prince William Sound.